Section 66.05 - Certification of HD Projects and Qualified Project ExpenditureFollowing approval of a HD Zone and HD Zone Plan by the Department, the Department will accept applications for certification of housing development projects as HD Projects and the QPEs.
(1)General. (a) Sponsors shall submit applications for Preliminary Certification and Conditional Certification under the pains and penalties of perjury by a person authorized to bind the Sponsors.(b) An application that provides all the information required by M.G.L. c. 40V and 760 CMR 66.00 shall be considered a complete project proposal for purposes of M.G.L. c. 40V, § 4(c). If the Department determines that an application is not complete, it shall provide the Municipality with opportunity to supplement its application.(2)Preliminary Certification - Site and Building. (a) At a minimum, the application for Preliminary Certification shall contain the following information and materials related to the building(s) that comprise the housing development project: 1. A map identifying the locus of the building(s);2. Site plan showing lot lines, building footprint and general dimensions;3. Photographs of the existing building(s) and/or drawings of new construction;4. Evidence of the need for new construction or Substantial Rehabilitation5. A narrative description of the proposed new construction or Substantial Rehabilitation of the building(s), including the total number of proposed units and the number of proposed Market Rate Residential Units;6. Evidence that the Sponsor has site control;7. Proposed sources and uses budget;8. Request from the Municipality, executed by the chief executive officer of the Municipality, that the project be approved as a HD Project; and9. Certified copy of the vote by the Municipality to enter into an agreement for a tax exemption under M.G.L. c. 59, § 5M and M.G.L. c. 40V, § 4(b)(i).(b) If the Department determines that the new construction or existing building(s) meets the requirements of M.G.L. c. 40V, § 4(a)(i) through (iv) and (vi), either in its present state or upon construction or Substantial Rehabilitation, then the Department shall provide a Preliminary Certification acknowledging that the building meets the standards of a Certified Housing Development Project.(3)Conditional Certification - New Construction or Rehabilitation Plans. (a) At a minimum, the application for Conditional Certification shall contain the following information and materials: 1. Construction plans and specifications;2. Construction cost estimate prepared by a qualified third party;3. Construction schedule;4. Residential marketing strategies and plan including affirmative fair housing outreach;5. Materials required by M.G.L. c. 40V, § 4(b)(ii) and (iii);6. Satisfactory evidence that the proposed Market Rate Residential Units will be priced consistently with prevailing rents or sale prices for market rate units in the municipality, including a narrative and supporting data that describes the methodology for setting the unit prices;7. Documentation that there is a reasonable likelihood that the Sponsor will be successful in the sale or lease of the Market Rate Residential Units, including a narrative and supporting data that evidences the marketability of the units; and8. Executed agreement by the Municipality that contains a tax exemption under M.G.L. c. 59, § 5M and M.G.L. c. 40V, § 4(b)(i).(b) If the Department determines that the proposed housing development project continues to meet the requirements for Preliminary Certification pursuant to 760 CMR 66.05(2)(a), then the Department shall provide a Conditional Certification acknowledging that if the project is completed as proposed, it will meet the standards for a HD Project and for Final Certification of QPEs.(c) If the Department determines that the housing development project does not meet the requirements of 760 CMR 66.05(2)(a), it shall provide the Municipality written notice of such determination including an explanation for the denial.(d) The application for Conditional Certification may be submitted in conjunction with the application for Preliminary Certification.(4)Final Certification.(a) The application for Final Certification may be submitted at such time as certificates of occupancy have been issued for the entire housing development project and 80% of the Market Rate Residential Units have been leased or sold to the party who will occupy them as a primary residence. The application shall contain the following information and materials: 1. If the Sponsor has been awarded HDTC or if the Municipality otherwise requires, a cost certification by a certified public accountant in a form required by the Department;2. Representative photographs of the completed work (both exterior and interior views); and3. A certification by the Sponsor that the new construction or rehabilitation has been completed substantially in accordance with the construction plans and specifications upon which the Department relied in approving the application for Conditional Certification.(b) Provided that a Sponsor pursues the marketing strategies and plan for the Market Rate Residential Units in a manner that is consistent with the representations made by the Sponsor in its application for Conditional Certification, and with the practices of the commercial real estate industry, then following shall not be grounds for denying Final Certification: The bona fide sale or lease of Market Rate Residential Units at a price or rent below the level proposed in good faith at the time of the application for Conditional Certification.
(c) If the Department determines that the housing development project has been completed in a manner that is consistent with the Conditional Certification and that it meets the standards of M.G.L. c. 40V, § 4, the Department shall issue a Final Certification. A Final Certificate shall designate the housing development project as a HD Project and state the amount of the QPE. A Final Certificate shall have a term of not less than five years and not more than the term of the HD Tax Increment Exemption Agreement between the Municipality and the Sponsor.(5)Notice to Department of Revenue. Within ten days of granting or revoking a Final Certification the Department shall provide a copy of the Final Certification or Revocation of Final Certification to the Commissioner.Amended by Mass Register Issue 1336, eff. 4/7/2017.